Advertisement
News

Dow ends streak, falls 3.36 Midmorning rally fizzles after index surpasses 6,100 for first time

NEW YORK — NEW YORK -- U.S. stocks fell from records, unable to hold onto gains forged during a midmorning rally. Retailers were among the day's biggest losers, sliding on concern the economy's slowdown will lead consumers to spend less.

The up-and-down day of trading was mirrored by International Business Machines Corp., which climbed to a five-year high of $135.375 only to end the session at $130, up 62.5 cents. Optimism about the company's personal computer business gave way by day's end to lingering doubt about how much further the stock can rise.

Advertisement

The Dow Jones industrial average fell 3.36 to 6,090.87, snapping a three-day streak of records. At its top, the 30-stock average reached 6,133.73 -- its first move above 6,100. Procter & Gamble Co. paced the drop, sliding $2.125 to $97.

Broad stock market indexes also retreated from highs. The Standard & Poor's 500 index finished down 0.97 to 709.85 after climbing to 714.10 and the Nasdaq composite index dropped 6.08 to 1,236.40.

Advertisement

The Russell 2,000 index of small capitalization stocks lost 1.75 to 346.10; the Wilshire 5,000 index, comprising stocks on the New York, American and Nasdaq exchanges, dropped 16.38 to 6,927.42; the American Stock Exchange market value index slid 2.16 to 576.87, and the S&P; midcap index rose dropped 1.27 to 244.62.

Detroit & Canada Tunnel Corp. was among the biggest gainers on the day, surging $11 to $51. The tunnel operator said it agreed to be acquired by Hyde Park Holding Inc. for $54 a share.

Among retailers, Sears, Roebuck & Co. fell $1.75 to $49.375; J. C. Penney Co. lost $1 to $53; and Wal-Mart Stores Inc. dropped 50 cents to $27.625.

Neurocrine Biosciences Inc. rose 37.5 cents to $11.125. The developer of treatments for diseases of the central nervous and immune systems said it entered into a research agreement with Eli Lilly & Co. centering on obesity and Alzheimer's disease.

One of the biggest losers on the day was Molten Metal Technology Inc., which plunged $13.875 to $14.25.

The disposer of hazardous waste warned late yesterday that its government research will be less than expected this year.

About 1,311 stocks fell and 1,058 rose on the New York Stock Exchange, where 408 million shares traded. The three-month daily average is 378 million shares.

Oil shares were mixed after initially rallying after a round of better-than-expected profit reports from the industry's leaders.

Advertisement

While the rally in crude oil prices than began in midsummer will help pad profits for producers, companies with big refining operations, such as Chevron Corp. and Exxon Corp., will have to pay more for their raw materials.

As a result, crack spreads, a measure of refining profitability, tumbled 6 percent yesterday as the the price of a barrel of oil rose 12 cents to $25.46 on the New York Mercantile Exchange. Crude oil is up 34 percent since July 26.

Among the producers whose profits topped expectations, Texaco Inc. increased $2.50 a share to $105.875 and Amoco Corp. rose 50 cents to $75.375. Exxon Corp. retreated to $89, down 37.5 cents, after rising to $90.50.

Mobil Corp. fell $1.125 to $119.75 after it said third-quarter profit from operations fell 10 percent, as lower chemical prices and refining margins wiped out the benefit of higher oil and natural gas prices.

McDonald's Corp. dropped $1.375 to $44.75. On Friday, the hamburger chain said third-quarter net income rose a less-than-expected 10 percent, as competition ate into U.S. sales and a stronger dollar cut into international profits.

Overall, profits this quarter are beating expectations.

Advertisement

Of the 258 companies in the S&P; 500 to post results for the quarter ended Sept. 30, about 131, or 50.8 percent, topped estimates.

On the downside, 85, or 32.9 percent, fell short and the remaining 16.3 percent were in line.

Pub Date: 10/22/96



Advertisement